sec document
UNITED STATES
SECURTIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF
THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant |_|
Filed by a Party other than the Registrant |X|
Check the appropriate box:
|X| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
|_| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Under Rule 14a-12
LUBY'S, INC.
--------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
STARBOARD VALUE AND OPPORTUNITY MASTER FUND LTD.
PARCHE, LLC
RCG ENTERPRISE, LTD
RCG STARBOARD ADVISORS, LLC
RAMIUS CAPITAL GROUP, L.L.C.
C4S & CO., L.L.C.
PETER A. COHEN
MORGAN B. STARK
JEFFREY M. SOLOMON
THOMAS W. STRAUSS
STEPHEN FARRAR
WILLIAM J. FOX
BRION G. GRUBE
MATTHEW Q. PANNEK
JEFFREY C. SMITH
GAVIN MOLINELLI
--------------------------------------------------------------------------------
(Name of Persons(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
|X| No fee required.
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
(1) Title of each class of securities to which transaction applies:
--------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
--------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
--------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
--------------------------------------------------------------------------------
(5) Total fee paid:
--------------------------------------------------------------------------------
|_| Fee paid previously with preliminary materials.
--------------------------------------------------------------------------------
|_| Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
(1) Amount previously paid:
--------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
--------------------------------------------------------------------------------
(3) Filing Party:
--------------------------------------------------------------------------------
(4) Date Filed:
--------------------------------------------------------------------------------
PERSONS WHO ARE TO RESPOND TO THE COLLECTION OF INFORMATION CONTAINED IN THIS
FORM ARE NOT REQUIRED TO RESPOND UNLESS THE FORM DISPLAYS A CURRENTLY VALID OMB
CONTROL NUMBER.
PRELIMINARY COPY SUBJECT TO COMPLETION
DATED __________, 2007
STARBOARD VALUE AND OPPORTUNITY MASTER FUND LTD.
______________, 2007
Dear Fellow Shareholder:
Starboard Value and Opportunity Master Fund Ltd. ("Starboard") and the
other participants in this solicitation (collectively, the "Ramius Group") are
the beneficial owners of an aggregate of 1,864,500 shares of common stock of
Luby's, Inc. (the "Company"), representing approximately ___% of the outstanding
shares of common stock of the Company. For the reasons set forth in the attached
Proxy Statement, the Ramius Group does not believe that the Board of Directors
of the Company is acting in the best interest of its shareholders. The Ramius
Group is therefore seeking your support at the Annual Meeting of Shareholders
scheduled to be held at ______________ located at _____________, _______,
_______, ________, on January 15, 2008 at _______ _.m., ___________, for the
following:
1. To elect Starboard's slate of four nominees to the Board of Directors
to serve until the 2011 Annual Meeting of Shareholders; and
2. To ratify the appointment of Grant Thornton LLP as independent auditor
for the 2008 fiscal year.
The Ramius Group urges you to carefully consider the information contained
in the attached Proxy Statement and then support its efforts by signing, dating
and returning the enclosed GOLD proxy card today. The attached Proxy Statement
and the enclosed GOLD proxy card are first being furnished to the shareholders
on or about ___________ __, 2007.
If you have already voted for the incumbent management slate, you have
every right to change your vote by signing, dating and returning a later dated
proxy.
If you have any questions or require any assistance with your vote, please
contact Innisfree M&A Incorporated, which is assisting us, at their address and
toll-free numbers listed on the following page.
Thank you for your support.
Jeffrey C. Smith
Starboard Value and Opportunity Master
Fund Ltd.
-3-
--------------------------------------------------------------------------------
IF YOU HAVE ANY QUESTIONS, REQUIRE ASSISTANCE IN VOTING YOUR GOLD PROXY CARD,
OR NEED ADDITIONAL COPIES OF STARBOARD'S PROXY MATERIALS, PLEASE CALL
INNISFREE M&A INCORPORATED AT THE PHONE NUMBERS LISTED BELOW.
--------------------------------------------------------------------------------
Innisfree M&A Incorporated
501 Madison Avenue, 20th Floor
New York, NY 10022
Shareholders Call Toll-Free at: (877) 800-5185
Banks and Brokers Call Collect at: (212) 750-5833
2008 ANNUAL MEETING OF SHAREHOLDERS
OF
LUBY'S, INC.
-------------------------
PROXY STATEMENT
OF
STARBOARD VALUE AND OPPORTUNITY MASTER FUND LTD.
-------------------------
PLEASE SIGN, DATE AND MAIL THE ENCLOSED GOLD PROXY CARD TODAY
Starboard Value and Opportunity Master Fund Ltd., a Cayman Islands
exempted company ("Starboard"), Parche, LLC, a Delaware limited liability
company ("Parche"), RCG Enterprise, Ltd, a Cayman Islands exempted company ("RCG
Enterprise"), RCG Starboard Advisors, LLC, a Delaware limited liability company
("RCG Starboard Advisors"), Ramius Capital Group, L.L.C., a Delaware limited
liability company ("Ramius Capital"), C4S & Co., L.L.C., a Delaware limited
liability company ("C4S"), Peter A. Cohen ("Mr. Cohen"), Morgan B. Stark ("Mr.
Stark"), Thomas W. Strauss ("Mr. Strauss"), Jeffrey M. Solomon ("Mr. Solomon"),
Stephen Farrar ("Mr. Farrar"), William J. Fox ("Mr. Fox"), Brion G. Grube ("Mr.
Grube") and Mathew Q. Pannek ("Mr. Pannek") (collectively, the "Ramius Group")
are significant shareholders of Luby's, Inc., a Delaware corporation ("Luby's"
or the "Company"). The members of the Ramius Group, as well as Jeffrey C. Smith
("Mr. Smith") and Gavin Molinelli ("Mr. Molinelli"), are participants in this
solicitation. Mr. Smith is a Partner of Ramius Capital and Mr. Molinelli is an
Associate of Ramius Capital. The Ramius Group does not believe that the Board of
Directors of the Company (the "Board") is acting in the best interest of its
shareholders. The Ramius Group is therefore seeking your support at the Annual
Meeting of Shareholders scheduled to be held at ______________ located at
_____________, _______, _______, ________, on January 15, 2008 at _______ _.m.,
___________, including any adjournments or postponements thereof and any meeting
which may be called in lieu thereof (the "Annual Meeting"), for the election of
Starboard's director nominees, Stephen Farrar, William J. Fox, Brion G. Grube
and Mathew Q. Pannek (the "Ramius Nominees"), to serve until the 2011 Annual
Meeting of Shareholders.
As of ________ __, 2007, the approximate date on which this Proxy
Statement is being mailed to shareholders, the members of the Ramius Group were
the beneficial owners of an aggregate of 1,864,500 shares of common stock of the
Company, par value $0.32 per share (the "Shares"), which currently represents
approximately ___% of the issued and outstanding Shares, all of which are
entitled to be voted at the Annual Meeting.
Luby's has set the record date for determining shareholders entitled to
notice of and to vote at the Annual Meeting as ___________, 2007 (the "Record
Date"). The mailing address of the principal executive offices of Luby's is
13111 Northwest Freeway, Suite 600, Houston, Texas 77040. Shareholders of record
at the close of business on the Record Date will be entitled to vote at the
Annual Meeting. According to Luby's, as of the Record Date, there were
__________ Shares outstanding and entitled to vote at the Annual Meeting. The
participants in this solicitation intend to vote all of their Shares FOR the
election of the Ramius Nominees.
THIS SOLICITATION IS BEING MADE BY THE RAMIUS GROUP AND NOT ON BEHALF OF THE
BOARD OF DIRECTORS OR MANAGEMENT OF THE COMPANY. THE RAMIUS GROUP IS NOT AWARE
OF ANY OTHER MATTERS TO BE BROUGHT BEFORE THE ANNUAL MEETING. SHOULD OTHER
MATTERS, WHICH THE RAMIUS GROUP IS NOT AWARE OF A REASONABLE TIME BEFORE THIS
SOLICITATION, BE BROUGHT BEFORE THE ANNUAL MEETING, THE PERSONS NAMED AS PROXIES
IN THE ENCLOSED GOLD PROXY CARD WILL VOTE ON SUCH MATTERS IN THEIR DISCRETION.
THE RAMIUS GROUP URGES YOU TO SIGN, DATE AND RETURN THE GOLD PROXY CARD IN FAVOR
OF THE ELECTION OF ITS NOMINEES.
IF YOU HAVE ALREADY SENT A PROXY CARD FURNISHED BY LUBY'S MANAGEMENT TO LUBY'S,
YOU MAY REVOKE THAT PROXY AND VOTE FOR THE ELECTION OF THE RAMIUS NOMINEES BY
SIGNING, DATING AND RETURNING THE ENCLOSED GOLD PROXY CARD. THE LATEST DATED
PROXY IS THE ONLY ONE THAT COUNTS. ANY PROXY MAY BE REVOKED AT ANY TIME PRIOR TO
THE ANNUAL MEETING BY DELIVERING A WRITTEN NOTICE OF REVOCATION OR A LATER DATED
PROXY FOR THE ANNUAL MEETING TO THE RAMIUS GROUP, C/O INNISFREE M&A INCORPORATED
WHICH IS ASSISTING IN THIS SOLICITATION, OR TO THE SECRETARY OF LUBY'S, OR BY
VOTING IN PERSON AT THE ANNUAL MEETING.
-2-
IMPORTANT
YOUR VOTE IS IMPORTANT, NO MATTER HOW FEW SHARES YOU OWN. THE RAMIUS GROUP
URGES YOU TO SIGN, DATE, AND RETURN THE ENCLOSED GOLD PROXY CARD TODAY TO VOTE
FOR THE ELECTION OF THE RAMIUS NOMINEES.
o If your Shares are registered in your own name, please sign and date
the enclosed GOLD proxy card and return it to the Ramius Group, c/o
Innisfree M&A Incorporated, in the enclosed envelope today.
o If your Shares are held in a brokerage account or bank, you are
considered the beneficial owner of the Shares, and these proxy
materials, together with a GOLD voting form, are being forwarded to
you by your broker or bank. As a beneficial owner, you must instruct
your broker, trustee or other representative how to vote. Your
broker cannot vote your Shares on your behalf without your
instructions. Accordingly, please contact the person responsible for
your account and instruct that person to execute on your behalf the
GOLD proxy card. The Ramius Group urges you to confirm your
instructions in writing to the person responsible for your account
and to provide a copy of such instructions to the Ramius Group, c/o
Innisfree M&A Incorporated, who is assisting in this solicitation,
at the address and telephone numbers set forth below, and on the
back cover of this Proxy Statement, so that we may be aware of all
instructions and can attempt to ensure that such instructions are
followed.
o Depending upon your broker or custodian, you may be able to vote
either by toll-free telephone or by the Internet. Please refer to
the enclosed voting form for instructions on how to vote
electronically. You may also vote by signing, dating and returning
the enclosed voting form.
Since only your latest dated proxy card will count, we urge you not to
return any proxy card you receive from the Company. Even if you return the
management proxy card marked "withhold" as a protest against the incumbent
directors, it will revoke any proxy card you may have previously sent to the
Ramius Group. Remember, you can vote for our four nominees only on our GOLD
proxy card. So please make certain that the latest dated proxy card you return
is the GOLD proxy card.
If you have any questions regarding your proxy, or need
assistance in voting your Shares, please call:
INNISFREE M&A INCORPORATED
501 MADISON AVENUE, 20TH FLOOR
NEW YORK, NY 10022
SHAREHOLDERS CALL TOLL-FREE AT: (877) 800-5185
BANKS AND BROKERS CALL COLLECT AT: (212) 750-5833
-3-
REASONS FOR THE SOLICITATION
The Ramius Group owns in the aggregate a total of 1,864,500 Shares,
representing approximately ___% of the issued and outstanding common stock of
the Company. We believe the election of the Ramius Nominees represents the best
means for Luby's shareholders to maximize the value of their Shares. We believe
that our nominees will strengthen the quality of Luby's Board by adding valuable
restaurant industry and corporate finance expertise. Additionally, we believe
that a board comprised of truly independent directors will best serve
shareholders and ensure that any future potential conflicts of interest between
Luby's and Pappas restaurants are evaluated and addressed appropriately.
OUR NOMINEES WILL STRENGTHEN THE QUALITY OF THE LUBY'S BOARD BY
PROVIDING ESSENTIAL RESTAURANT AND CORPORATE FINANCE EXPERTISE.
The Ramius Group, as the largest independent shareholder of Luby's, has a
vested financial interest in the maximization of the value of Luby's Shares. Our
interests are aligned with the interests of all shareholders. The Ramius
Nominees are highly experienced restaurant and corporate finance professionals.
They are well qualified to oversee the Luby's management team and can prove
valuable in evaluating and executing the Company's new growth strategy. They are
committed to acting solely in the best interest of all Luby's shareholders. If
elected, we believe the Ramius Nominees will strengthen the Board and enable a
higher probability of the most successful outcome.
WE WISH TO PROVIDE SHAREHOLDERS WITH THE OPPORTUNITY TO ELECT NEW DIRECTORS
TO THE BOARD WHO ARE TRULY INDEPENDENT AND WHO, IF ELECTED, WILL WORK TO
IMPROVE BOARD OVERSIGHT.
The current Luby's management team and Board include several individuals
who are currently working, or have formerly worked, at Pappas restaurants,
including Christopher J. Pappas, the Company's Chief Executive Officer (the
"CEO"), and Harris J. Pappas, the Company's Chief Operating Officer (the "COO"),
both of whom serve on the current Board. In order to ensure that the Company is
being operated with the best interest of Luby's shareholders in mind, we believe
it is imperative for Luby's to have a strong, independent Board that can
evaluate any future potential conflicts of interest between Luby's and Pappas
restaurants.
As an example of these potential conflicts of interest, on October 30,
2007, Luby's announced that it had amended its shareholder rights plan, or
"poison pill", to increase the number of shares of common stock that the CEO and
COO are permitted to own without triggering the poison pill to 33% of the
Company's outstanding shares, while the threshold for all other shareholders
remains at 15%. The primary purpose of a "poison pill" is to require a potential
acquirer to negotiate an appropriate control premium with a company's board
before allowing such an acquirer to gain control. In our opinion, shareholders
receive no conceivable benefit from the Board allowing the Pappas brothers to
further increase their effective control of the Company without paying
shareholders a control premium.
OUR INDEPENDENT NOMINEES ARE COMMITTED TO ACTING IN THE BEST INTEREST OF
ALL SHAREHOLDERS AND WILL WORK DILIGENTLY WITH THE OTHER BOARD MEMBERS AND
MANAGEMENT TO AID IN THE EXECUTION OF THE GROWTH STRATEGY WHILE EXPLORING ANY
AND ALL ALTERNATIVES TO ENHANCE SHAREHOLDER VALUE.
Each of the Ramius Nominees, if elected, will exercise his independent
judgment in accordance with his fiduciary duties as a director in all matters
that come before the Board. The Ramius Nominees are independent of the Company
in accordance with Securities and Exchange Commission ("SEC") and New York Stock
-4-
Exchange, Inc. ("NYSE") rules on board independence and would seek to maximize
value for all shareholders. If elected, subject to their fiduciary duties as
directors, the Ramius Nominees would have the ability to work with the other
members of the Board to take those steps that they deem are necessary or
advisable to unlock the Company's intrinsic value and generate long-term value
at the Company. Additionally, the Ramius Nominees, if elected, would be able to
render independent judgment for the best interests of all of the Company's
shareholders.
Although the Ramius Nominees will not be able to adopt any measures
without the support of at least some members of the current Board, we believe
that the election of the Ramius Nominees will send a strong message to the Board
that shareholders believe in the long-term value of the Company and that the
path to maximizing value is through increased Board oversight and
accountability.
LUBY'S HAS MAINTAINED POOR CORPORATE GOVERNANCE PRACTICES.
In addition to the potential conflicts of interest that exist as a result
of several members of Luby's management and the Board currently and/or formerly
being employed with Pappas restaurants, the Ramius Group believes that Luby's
has and continues to maintain poor corporate governance practices which inhibit
the accountability of management and directors. Examples of what we believe to
be the poor corporate governance practices of Luby's include:
o The Company has maintained a "staggered" or classified board.
DESPITE A MAJORITY OF THE SHARES CAST HAVING BEEN VOTED IN FAVOR OF
A SHAREHOLDER PROPOSAL TO DECLASSIFY THE BOARD IN YEARS 2001, 2003,
2004, 2005, AND 2006, THE COMPANY HAS YET TO IMPLEMENT OR TAKE THE
NECESSARY ACTIONS TO IMPLEMENT THE PROPOSAL;
o The Company maintains anti-takeover defenses, including a
shareholder rights plan or "poison pill." ALTHOUGH THE OWNERSHIP
THRESHOLD FOR ALL OTHER SHAREHOLDERS TO TRIGGER THE POISON PILL IS
15%, THE PAPPASES ARE NOW PERMITTED TO COLLECTIVELY OWN UP TO 33% OF
THE SHARES OUTSTANDING WITHOUT TRIGGERING THE POISON PILL;
o The Company's Bylaws permit the Board to increase the size of the
Board and to fill vacancies without shareholder approval;
o A supermajority vote is required for shareholders to amend certain
provisions of the Company's Certificate of Incorporation and Bylaws,
including rescinding the classified Board;
o Special meetings of shareholders may only be called by the
shareholders to the extent that they hold at least 50% of the
outstanding voting Shares; and
o Shareholders are prohibited from taking action by written consent.
Such measures, we believe, serve no reasonable purpose other than to allow
for the entrenchment of directors and demonstrate a disregard for the interests
of shareholders. Furthermore, we question how Luby's management can exercise
independent judgment without proper independent board oversight.
-5-
Governance provisions such as these are contrary to the guidelines for
corporate governance best practices issued by leading advocates of shareholder
democracy, such as Institutional Shareholder Services (ISS) and Glass, Lewis &
Co. What these provisions do provide, in our opinion, is insulation to the
incumbent Board and few avenues for change to shareholders dissatisfied with the
status quo. If elected, the Ramius Nominees will use their best efforts to cause
the Board to terminate the poison pill and implement corporate governance reform
while exploring all potential alternatives to maximize shareholder value.
In the event that the Board attempts to use new bylaws or amended bylaws
to prevent the shareholders, including the Ramius Group, from accomplishing the
objectives described in this Proxy Statement, the Ramius Nominees, if elected,
will seek to work with the other Board members to repeal any new or amended
bylaws having such an effect to the extent that the Ramius Nominees determine
that such new or amended bylaws are not aligned with the shareholders' best
interests.
The following is a chronology of events leading up to this proxy
solicitation:
o On May 1, 2007, Starboard delivered a letter to the Chief Executive
Officer of the Company requesting a meeting.
o On July 30, 2007, Ramius Capital filed a Schedule 13D with the SEC
wherein it attached a letter from RCG Starboard Advisors to the
Chief Executive Officer of the Company. The letter outlined RCG
Starboard Advisors' view that the Company could maximize value by
either 1) executing a sale leaseback on a substantial portion of the
owned real estate with a coincident stock buyback and special
dividend or 2) selling the Company for a price that reflects the
full value of the Luby's concept and the associated real estate in
order to maximize risk adjusted returns for shareholders. The letter
also stated RCG Starboard Advisors' belief that the Company should
address the potential conflicts of interest and time commitment
issues of certain of Luby's members of management and directors who
are also employed by, or otherwise affiliated with, the Pappas
restaurant entities.
o On October 2, 2007, certain representatives of Ramius Capital met
with Luby's management team. The purpose of the meeting was to gain
a better understanding of the Company's overall strategy and plans
to unlock value at the Company.
o On October 15, 2007, Starboard delivered a letter to the Company in
accordance with the Company's advance notice bylaw provision,
nominating Messrs. Farrar, Fox, Grube and Pannek for election to the
Board at the Annual Meeting.
o On October 17, 2007, Starboard delivered a letter to the Company
requesting, pursuant to Section 220 of the Delaware General
Corporation Law, a complete list of the Company's shareholders and
other corporate records in order to allow Starboard to communicate
with the Company's shareholders in connection with the election of
-6-
directors to be submitted to a vote of the shareholders at the
Annual Meeting, and any other matters as may properly come before
the Annual Meeting.
o On November 5, 2007, RCG Starboard issued a letter to all the
shareholders of Luby's, Inc. urging all shareholders to vote for its
four independent director nominees at the upcoming Annual Meeting
and questioning whether the Board has been acting in the best
interest of all shareholders. As examples, the letter highlighted
(i) the recent decision by the Board to increase the exemption under
the poison pill granted to Chris and Harris Pappas, allowing them to
further increase their effective control of the Company without
paying shareholders a control premium, and (ii) the fact that in
five out of the past six shareholder votes, the Board has chosen to
ignore the affirmative vote of shareholders on the proposal to
declassify the Board.
-7-
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The Ramius Group is seeking your support at the Annual Meeting to elect
the Ramius Nominees in opposition to Luby's director nominees. The Board is
currently composed of ten directors divided into three classes. The Ramius Group
believes that four directors' terms expire at the Annual Meeting. We are seeking
your support at the Annual Meeting to elect the Ramius Nominees in opposition to
four of Luby's director nominees. Your vote to elect the Ramius Nominees will
have the legal effect of replacing four incumbent directors of Luby's with the
Ramius Nominees. If elected, the Ramius Nominees will represent a minority of
the members of the Board.
THE RAMIUS NOMINEES
The Ramius Group has nominated four highly qualified nominees, each of
whom, if elected, will exercise his independent judgment in accordance with his
fiduciary duties as a director in all matters that come before the Board. The
Ramius Nominees are independent of the Company in accordance with SEC and NYSE
rules on board independence and would seek to maximize value for all
shareholders. If elected, and subject to their fiduciary duties as directors,
the Ramius Nominees would have the ability to work with the other members of the
Board to take those steps that they deem are necessary or advisable to unlock
the Company's intrinsic value.
Set forth below are the name, age, business address, present principal
occupation, and employment and material occupations, positions, offices, or
employments for the past five years of each of the Ramius Nominees. This
information has been furnished to the Ramius Group by the Ramius Nominees. The
Ramius Nominees are citizens of the United States of America. The Ramius
Nominees have been nominated by the Ramius Group in accordance with the
Company's advance notice bylaw provision.
STEPHEN FARRAR (AGE 57) served as Senior Vice President, Western Region of
Wendy's International, Inc. (NYSE:WEN) from 1992 until September 2006. From
March 1998 to June 1999, Mr. Farrar also acted as Regional Vice President of
Wendy's Pacific International Region. Mr. Farrar joined Wendy's in 1980 and has
held various executive positions, including Division Vice President, Texas
Division (1987-1992), Regional Vice President, Franchise Operations (1983-1987)
and Regional Director, Company Operations (1981-1983). Prior to joining Wendy's,
Mr. Farrar served as President and Owner of Restaurant Profitability Analysts, a
restaurant consulting firm (1979-1980) and President of Pelican's Restaurants, a
casual dining chain (1976-1978). Mr. Farrar served on the Board of Directors of
Pasta Pomodoro, a California and Arizona restaurant chain, from 2005 to 2006.
Mr. Farrar attended the University of Texas at Arlington where he studied
business pre-law. The principal business address of Mr. Farrar is P.O. Box 6554,
Stateline, Nevada 89449. As of the date hereof, Mr. Farrar does not directly own
any securities of Luby's nor has he made any purchases or sales of any
securities of Luby's during the past two years. As a Ramius Nominee, Mr. Farrar
may be deemed to beneficially own all securities of Luby's beneficially owned by
members of the Ramius Group, which as of the date hereof, may be deemed to
-8-
beneficially own 1,864,500 shares of common stock of Luby's. For information
regarding purchases and sales during the past two years by the members of the
Ramius Group in securities of Luby's, please see Schedule I.
WILLIAM J. FOX (AGE 51) is currently a business advisor and strategy
consultant. From September 2004 until September 2007, Mr. Fox served as a
director of Nephros, Inc. (AMEX:NEP), a medical device company. From August 2006
until September 2007, Mr. Fox also served as the Executive Chairman of the Board
of Nephros, Inc. From October 2004 until May 2006, Mr. Fox was Vice Chairman of
Barington Capital and several of its affiliates, a group of equity investment
funds. Until December 2006, Mr. Fox had been a member of the Barington Advisory
Board since the founding of the Barington Funds in 1999. From October 2004 until
May 2006, Mr. Fox served as President, Chief Executive Officer and a director of
LQ Corporation (formerly OTCBB: LQCI, now merged into Sielox, Inc.), a marketer
of commercial and government security solutions, and from December 2004 until
May 2006, Mr. Fox served as President, Chief Executive Officer and a director of
Dynabazaar Inc. (OTCBB: FAIM), now Sielox, Inc. (OTCBB:SLXN.OB) which was
formerly engaged in online auctions of surplus assets. From November 2005 until
May 2006, Mr. Fox also served as a member of the Executive Committee of
Register.com (Cayman) L.P., a provider of domain name registration and Internet
services. From February 1999 until October 2004, Mr. Fox served as Chairman,
President, Chief Executive Officer and a director of AKI, Inc. ("AKI"), a
marketing and interactive advertising company, and during that time, Mr. Fox
also served as President, Chief Executive Officer and a director of AKI Holding
Corp., the parent of AKI. Prior to joining AKI, Mr. Fox served as
President-Strategic & Corporate Development of Revlon Worldwide, Inc., Chief
Executive Officer of Revlon Technologies, Inc., Senior Executive Vice President
of Revlon Inc. and Senior Vice President of MacAndrews & Forbes Holdings Inc.
("MacAndrews"). Mr. Fox joined MacAndrews in 1983 and had held various senior
executive positions in MacAndrews and in several of its subsidiaries and
affiliates, including Revlon, Inc., Brooks Drugs, The Coleman Company, First
Gibraltar Bank Holdings, Wilbur Chocolate, New World Entertainment and
Technicolor Inc. Mr. Fox has also served as a director of several public
companies, including Loehmann's Holding Inc. (formerly NASD:LHMS) where he was
Co-Chairman of the Board (October 2000 through October 2004), MM Companies Inc.
(now George Foreman Enterprises Inc.) (2003-2004), Revlon, Inc. (NYSE:REV)
(1996-1999) and The Hain Food Group where he was Vice Chairman of the Board
(NASD:HAIN) (1996-1999). Mr. Fox received a B.B.A. (magna cum laude) in Public
Accounting from Pace University Lubin School and an M.B.A. (with distinction) in
Public Accounting from Pace University Graduate School. Mr. Fox is also a
Certified Public Accountant. The principal business address of Mr. Fox is P.O.
Box 893, Alpine N.J. 07620. As of the date hereof, Mr. Fox does not directly own
any securities of Luby's nor has he made any purchases or sales of any
securities of Luby's during the past two years. As a Ramius Nominee, Mr. Fox may
be deemed to beneficially own all securities of Luby's beneficially owned by
members of the Ramius Group, which as of the date hereof, may be deemed to
beneficially own 1,864,500 shares of common stock of Luby's. For information
regarding purchases and sales during the past two years by the members of the
Ramius Group in securities of Luby's, please see Schedule I.
BRION GRUBE (AGE 56) served as Chief Executive Officer and President of
Baja Fresh Mexican Grill, a subsidiary of Wendy's International, Inc. (NYSE:
WEN), from 2005 to 2006. From 2004 to 2005, Mr. Grube served as Chief Executive
-9-
Officer and President of Cafe Express, also a subsidiary of Wendy's, and as
Executive Vice President of Wendy's International Division. Mr. Grube joined
Wendy's in 1990 and has held various executive positions, including Senior Vice
President of the International Division from (2001 - 2004), Senior Vice
President of Wendy's Restaurants of Canada (1993 - 2001) and a Division Vice
President in Virginia (1990 - 1993). Mr. Grube previously was a Division Vice
President for Imperial Savings Association (1998 - 1990) and a Senior Vice
President of Operations for Globe Glass Inc./US Auto Glass Centers, a private
auto glass company (1987 - 1988). Mr. Grube also spent 13 years with Pizza Hut,
Inc. (1975 - 1987) in various management roles, including Region Manager,
Director of Systems Development, District Manager, Area Manager and Restaurant
Manager. Mr. Grube served on the Board of Directors of Pasta Pomodoro from 2003
to 2004. Mr. Grube has a Bachelor of Science Degree in Social Studies from
Millersville University. The principal address of Mr. Grube is 5078 Via Santana,
Newbury Park, CA 91320. As of the date hereof, Mr. Grube does not directly own
any securities of Luby's nor has he made any purchases or sales of any
securities of Luby's during the past two years. As a Ramius Nominee, Mr. Grube
may be deemed to beneficially own all securities of Luby's beneficially owned by
members of the Ramius Group, which as of the date hereof, may be deemed to
beneficially own 1,864,500 shares of common stock of Luby's. For information
regarding purchases and sales during the past two years by the members of the
Ramius Group in securities of Luby's, please see Schedule I.
MATTHEW Q. PANNEK (AGE 40) served as President and Chief Executive Officer
of Magic Brands, LLC and Fuddruckers, Inc., which owns and franchises restaurant
chains under the Fuddruckers and Koo Koo Roo brands, from May 2006 until August
2007. Mr. Pannek served as Chief Financial Officer of Fuddruckers, Inc. from
February 2005 to May 2006. From 1999 to February 2005, Mr. Pannek served as
Director of Accounting/Finance and Director of Investor Relations of Brinker
International, Inc. (NYSE:EAT), which owns and franchises casual dining chains,
including Chili's, On the Border Mexican Grill and Cantina, Maggiano's Little
Italy, and Romano's Macaroni Grill. Prior to joining Brinker, Mr. Pannek served
as Chief Financial Officer of Aaron Brothers, Inc., a subsidiary of Michaels
Stores, Inc. (NYSE:MIK), a retailer of arts and crafts materials, from 1996 to
1998, and as Acquisition & Capital Placement Manager of Maverick Capital Equity
Partners, a consulting firm affiliated with Aaron Brothers, Inc., from 1995 to
1996. From 1987 to 1995, Mr. Pannek served as Vice President of Corporate
Operations & Finance of MJDesigns, Inc., an arts and crafts retailer and
original founder of Michaels Stores. Mr. Pannek has served as a member of the
Board of Directors of Fuddruckers, Inc., King Cannon, Inc., Atlantic Restaurant
Ventures, Inc. and Aaron Brothers, Inc. Mr. Pannek received a B.A. in Finance
from the University of North Texas. The principal business address of Mr. Pannek
is 3140 La Ventana Parkway, Driftwood, Texas 78619. As of the date hereof, Mr.
Pannek does not directly own any securities of Luby's nor has he made any
purchases or sales of any securities of Luby's during the past two years. As a
Ramius Nominee, Mr. Pannek may be deemed to beneficially own all securities of
Luby's beneficially owned by members of the Ramius Group, which as of the date
hereof, may be deemed to beneficially own 1,864,500 shares of common stock of
Luby's. For information regarding purchases and sales during the past two years
by the members of the Ramius Group in securities of Luby's, please see Schedule
I.
RCG Starboard Advisors, an affiliate of Ramius Capital, and each of the
Ramius Nominees have entered into compensation letter agreements (the
"Compensation Letter Agreements") regarding compensation to be paid to each of
the Ramius Nominees for his agreement to be named and to serve as a Ramius
-10-
Nominee and for his services as a director of Luby's, if elected. Pursuant to
the terms of the Compensation Letter Agreements, RCG Starboard Advisors has
agreed to pay each Ramius Nominee $5,000 as a result of the submission by
Starboard of its nomination of the Ramius Nominees to the Company. Upon the
Ramius Group's filing of a definitive proxy statement with the SEC relating to a
solicitation of proxies in favor of the Ramius Nominees' election as directors
at the Annual Meeting, RCG Starboard Advisors has agreed to allow each Ramius
Nominee to receive a profit participation with respect to the profit, if any,
actually realized on the sale by RCG Starboard Advisors or its affiliates, as
the case may be, of the last $20,000 worth of Shares (the "Participation
Shares") beneficially owned by either RCG Starboard Advisors or its affiliates,
as the case may be, to a third party unaffiliated with any member of the Ramius
Group. Pursuant to the terms of the Compensation Letter Agreements, each Ramius
Nominee will be entitled to receive a cash payment equal to the amount, if any,
by which the proceeds received by RCG Starboard Advisors or its affiliates, as
the case may be, from the sale of the Participation Shares exceeds $20,000 in
the aggregate.
Ramius Capital and certain of its affiliates, have signed or intend to
sign a letter agreement pursuant to which they agree to indemnify the Ramius
Nominees against claims arising from the solicitation of proxies from Luby's
shareholders in connection with the Annual Meeting and any related transactions.
Other than as stated herein, there are no arrangements or understandings between
members of the Ramius Group and any of the Ramius Nominees or any other person
or persons pursuant to which the nomination of the Ramius Nominees described
herein is to be made, other than the consent by each of the Ramius Nominees to
be named in this Proxy Statement and to serve as a director of Luby's if elected
as such at the Annual Meeting. None of the Ramius Nominees are a party adverse
to Luby's or any of its subsidiaries or has a material interest adverse to
Luby's or any of its subsidiaries in any material pending legal proceedings.
The Ramius Group does not expect that the Ramius Nominees will be unable
to stand for election, but, in the event that such persons are unable to serve
or for good cause will not serve, the Shares represented by the enclosed GOLD
proxy card will be voted for substitute nominees. In addition, Starboard
reserves the right to nominate substitute persons if Luby's makes or announces
any changes to its Bylaws or takes or announces any other action that has, or if
consummated would have, the effect of disqualifying the Ramius Nominees. In any
such case, Shares represented by the enclosed GOLD proxy card will be voted for
such substitute nominees. Starboard reserves the right to nominate additional
persons if Luby's increases the size of the Board above its existing size or
increases the number of directors whose terms expire at the Annual Meeting.
Additional nominations made pursuant to the preceding sentence are without
prejudice to the position of Starboard that any attempt to increase the size of
the current Board or to reconstitute or reconfigure the classes on which the
current directors serve constitutes an unlawful manipulation of the Company's
corporate machinery.
YOU ARE URGED TO VOTE FOR THE ELECTION OF THE RAMIUS NOMINEES ON THE ENCLOSED
GOLD PROXY CARD.
-11-
PROPOSAL NO. 2
COMPANY PROPOSAL TO RATIFY APPOINTMENT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
As discussed in further detail in the Company's proxy statement, the
Company has appointed Grant Thornton LLP, an independent registered public
accounting firm, as auditors of the Company's financial statements for the 2008
fiscal year. The Company is asking shareholders to vote in favor of the
ratification of the appointment of Grant Thornton LLP as auditors for the fiscal
year ending August 30, 2008.
We make no recommendation as to the ratification of the appointment of
Grant Thornton LLP as the Company's independent auditors for the Company's
fiscal year ending August 30, 2008.
We are not aware of any other proposals to be brought before the Annual
Meeting. However, we intend to bring before the Annual Meeting such business as
may be appropriate, including without limitation nominating additional persons
for directorships, or making any proposals as may be appropriate to address any
action of the Board not publicly disclosed prior to the date of this proxy
statement. Should other proposals be brought before the Annual Meeting, the
persons named as proxies in the enclosed GOLD proxy card will vote on such
matters in their discretion.
-12-
VOTING AND PROXY PROCEDURES
Only shareholders of record on the Record Date will be entitled to notice
of and to vote at the Annual Meeting. Each Share is entitled to one vote.
Shareholders who sell Shares before the Record Date (or acquire them without
voting rights after the Record Date) may not vote such Shares. Shareholders of
record on the Record Date will retain their voting rights in connection with the
Annual Meeting even if they sell such Shares after the Record Date. Based on
publicly available information, the Ramius Group believes that the only
outstanding class of securities of Luby's entitled to vote at the Annual Meeting
is the Shares.
Shares represented by properly executed GOLD proxy cards will be voted at
the Annual Meeting as marked and, in the absence of specific instructions, will
be voted FOR the election of the Ramius Nominees to the Board and in the
discretion of the persons named as proxies on all other matters as may properly
come before the Annual Meeting.
You are being asked to elect the Ramius Nominees. The enclosed GOLD proxy
card may only be voted for the Ramius Nominees and does not confer voting power
with respect to the Company's nominees. Accordingly, you will not have the
opportunity to vote for any of Luby's nominees. You can only vote for Luby's
nominees by signing and returning a proxy card provided by Luby's. Shareholders
should refer to the Company's proxy statement for the names, backgrounds,
qualifications and other information concerning the Company's nominees. The
participants in this solicitation intend to vote all of their Shares in favor of
the Ramius Nominees.
QUORUM
The presence in person or by proxy of the holders of a majority of the
Shares outstanding will constitute a quorum at the Annual Meeting. Abstentions,
withheld votes and broker non-votes will be included in determining the presence
of a quorum at the meeting.
VOTES REQUIRED FOR APPROVAL
VOTE REQUIRED FOR THE ELECTION OF DIRECTORS. A majority of the votes cast
by the Shares present in person or represented by proxy and entitled to vote in
the election of directors at the Annual Meeting is required for the election of
a director nominee. Withheld votes and broker non-votes will not be included in
determining the number of votes cast in the election of directors. Shareholders
will not be allowed to cumulate their votes in the election of directors. A
shareholder may cast votes for the Ramius Nominees either by so marking the
ballot at the Annual Meeting or by specific voting instructions sent with a
signed proxy to either the Ramius Group in care of Innisfree M&A Incorporated at
the address set forth on the back cover of this Proxy Statement or to Luby's at
13111 Northwest Freeway, Suite 600, Houston, Texas 77040, or any other address
provided by Luby's.
VOTE REQUIRED FOR THE RATIFICATION OF APPOINTMENT OF GRANT THORNTON LLP. A
majority of the votes cast by the Shares present in person or represented by
proxy is required to ratify the appointment of Grant Thornton LLP as the
independent auditors of the Company's financial statements for the fiscal year
ending August 30, 2008.
-13-
ABSTENTIONS, WITHHELD VOTES AND BROKER NON-VOTES
ABSTENTIONS: Abstentions will have no effect in the proposal to ratify the
appointment of Grant Thornton LLP as the independent auditors of the Company's
financial statements for fiscal 2008.
WITHHELD VOTES: Withheld votes will have no effect on the election of
directors.
BROKER NON-VOTES: Under the rules of the National Association of
Securities Dealers, Inc., member brokers generally may not vote shares held by
them in street name for customers unless they are permitted to do so under the
rules of any national securities exchange of which they are a member. Under the
rules of the NYSE, member brokers who hold shares in street name for customers
have the authority to vote on certain "routine" items in the event that they
have not received instructions from beneficial owners. When a proposal is not a
"routine" matter and a brokerage firm has not received voting instructions from
the beneficial holder of the shares with respect to that proposal, the brokerage
firm may not vote the shares for that proposal. This is called a "broker
non-vote." Broker non-votes will have no effect on the election of directors or
the proposal to ratify the appointment of Grant Thornton LLP. Broker non-votes
will, however, be included for purposes of determining whether a quorum is
present at the Annual Meeting.
DISCRETIONARY VOTING
Shares held in "street name" and held of record by banks, brokers or
nominees may not be voted by such banks, brokers or nominees unless the
beneficial owners of such Shares provide them with instructions on how to vote.
REVOCATION OF PROXIES
Shareholders of Luby's may revoke their proxies at any time prior to
exercise by attending the Annual Meeting and voting in person (although
attendance at the Annual Meeting will not in and of itself constitute revocation
of a proxy) or by delivering a written notice of revocation. The delivery of a
subsequently dated proxy which is properly completed will constitute a
revocation of any earlier proxy. The revocation may be delivered either to the
Ramius Group in care of Innisfree M&A Incorporated at the address set forth on
the back cover of this Proxy Statement or to Luby's at 13111 Northwest Freeway,
Suite 600, Houston, Texas 77040, or any other address provided by Luby's.
Although a revocation is effective if delivered to Luby's, the Ramius Group
requests that either the original or photostatic copies of all revocations be
mailed to the Ramius Group in care of Innisfree M&A Incorporated at the address
set forth on the back cover of this Proxy Statement so that the Ramius Group
will be aware of all revocations and can more accurately determine if and when
proxies have been received from the holders of record on the Record Date and the
number of outstanding Shares represented thereby. Additionally, Innisfree M&A
Incorporated may use this information to contact shareholders who have revoked
their proxies in order to solicit later dated proxies for the election of the
Ramius Nominees.
-14-
IF YOU WISH TO VOTE FOR THE ELECTION OF THE RAMIUS NOMINEES TO THE BOARD, PLEASE
SIGN, DATE AND RETURN PROMPTLY THE ENCLOSED GOLD PROXY CARD IN THE POSTAGE-PAID
ENVELOPE PROVIDED.
SOLICITATION OF PROXIES
The solicitation of proxies pursuant to this Proxy Statement is being made
by the Ramius Group. Proxies may be solicited by mail, facsimile, telephone,
telegraph, Internet, in person and by advertisements.
Starboard has entered into an agreement with Innisfree M&A Incorporated
for solicitation and advisory services in connection with this solicitation, for
which Innisfree M&A Incorporated will receive a fee not to exceed $__________,
together with reimbursement for its reasonable out-of-pocket expenses, and will
be indemnified against certain liabilities and expenses, including certain
liabilities under the federal securities laws. Innisfree M&A Incorporated will
solicit proxies from individuals, brokers, banks, bank nominees and other
institutional holders. Starboard has requested banks, brokerage houses and other
custodians, nominees and fiduciaries to forward all solicitation materials to
the beneficial owners of the Shares they hold of record. Starboard will
reimburse these record holders for their reasonable out-of-pocket expenses in so
doing. It is anticipated that Innisfree M&A Incorporated will employ
approximately __ persons to solicit Luby's shareholders for the Annual Meeting.
The entire expense of soliciting proxies is being borne by the Ramius
Group. Costs of this solicitation of proxies are currently estimated to be
approximately $___,000.00. The Ramius Group estimates that through the date
hereof its expenses in connection with this solicitation are approximately
$___,000.00.
ADDITIONAL PARTICIPANT INFORMATION
The Ramius Nominees, the other members of the Ramius Group, Mr. Smith and
Mr. Molinelli are participants in this solicitation. The principal business of
each of Starboard and Parche is serving as a private investment fund. Each of
Starboard and Parche has been formed for the purpose of making equity
investments and, on occasion, taking an active role in the management of
portfolio companies in order to enhance shareholder value. The principal
business of RCG Enterprise is serving as a private investment fund. RCG is the
sole non-managing member of Parche and owns all economic interests therein. The
principal business of RCG Starboard Advisors is acting as investment manager of
Starboard and managing member of Parche. Ramius Capital is engaged in money
management and investment advisory services for third parties and proprietary
accounts and is the sole member of RCG Starboard Advisors. C4S serves as
managing member of Ramius Capital. Mr. Cohen, Mr. Strauss, Mr. Stark and Mr.
Solomon serve as co-managing members of C4S. Mr. Smith serves as a Partner of
Ramius Capital. Mr. Molinelli serves as an Associate of Ramius Capital.
The address of the principal office of each of Parche, RCG Starboard
Advisors, Ramius Capital, C4S, Mr. Cohen, Mr. Stark, Mr. Strauss, Mr. Solomon,
Mr. Smith and Mr. Molinelli is 666 Third Avenue, 26th Floor, New York, New York
10017. The address of the principal office of each of Starboard and RCG
-15-
Enterprise is c/o Citco Fund Services (Cayman Islands) Limited, Corporate
Center, West Bay Road, Grand Cayman, Cayman Islands, British West Indies.
As of the date hereof, Starboard beneficially owns 1,566,180 Shares and
Parche beneficially owns 298,320 Shares. As of the date hereof, RCG Enterprise
(as the sole non-managing member of Parche and owner of all economic interests
therein) is deemed to be the beneficial owner of the 298,320 Shares owned by
Parche. As of the date hereof, RCG Starboard Advisors (as the investment manager
of Starboard and the managing member of Parche) is deemed to be the beneficial
owner of the 1,566,180 Shares owned by Starboard and the 298,320 Shares owned by
Parche. As of the date hereof, each of Ramius Capital (as the sole member of RCG
Starboard Advisors), C4S (as the managing member of Ramius Capital) and Mr.
Cohen, Mr. Stark, Mr. Strauss and Mr. Solomon (as the managing members of C4S)
is deemed to be the beneficial owner of the 1,566,180 Shares owned by Starboard
and the 298,320 Shares owned by Parche. Mr. Cohen, Mr. Stark, Mr. Strauss and
Mr. Solomon share voting and dispositive power with respect to the Shares owned
by Starboard and Parche by virtue of their shared authority to vote and dispose
of such Shares. Messrs. Cohen, Stark, Strauss and Solomon disclaim beneficial
ownership of such Shares except to the extent of their pecuniary interest
therein. The Ramius Nominees, Mr. Smith and Mr. Molinelli, as members of a
"group" for the purposes of Rule 13d-5(b)(1) of the Securities Exchange Act of
1934, as amended, may be deemed to be a beneficial owner of the 1,566,180 Shares
owned by Starboard and the 298,320 Shares owned by Parche. The Ramius Nominees,
Mr. Smith and Mr. Molinelli disclaim beneficial ownership of Shares that they do
not directly own.
For information regarding purchases and sales of securities of Luby's
during the past two years by the members of the Ramius Group, Mr. Smith and Mr.
Molinelli, see Schedule I.
The members of the Ramius Group entered into a Joint Filing and
Solicitation Agreement, dated as of October 17, 2007 (as amended by Amendment
No. 1 thereto, dated as of October 31, 2007), in which each member of the Ramius
Group agreed to the joint filing on behalf of each of them of statements on
Schedule 13D and agreed to form the Ramius Group for the purpose of soliciting
proxies or written consents for the election of the Ramius Nominees to the Board
at the Annual Meeting and for the purpose of taking all other actions incidental
to the foregoing. The Ramius Group intends to seek reimbursement from Luby's of
all expenses it incurs in connection with the Solicitation. The Ramius Group
does not intend to submit the question of such reimbursement to a vote of
security holders of the Company.
Except as set forth in this Proxy Statement (including the Schedules
hereto), (i) during the past 10 years, no participant in this solicitation has
been convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors); (ii) no participant in this solicitation directly or indirectly
beneficially owns any securities of Luby's; (iii) no participant in this
solicitation owns any securities of Luby's which are owned of record but not
beneficially; (iv) no participant in this solicitation has purchased or sold any
securities of Luby's during the past two years; (v) no part of the purchase
price or market value of the securities of Luby's owned by any participant in
this solicitation is represented by funds borrowed or otherwise obtained for the
purpose of acquiring or holding such securities; (vi) no participant in this
solicitation is, or within the past year was, a party to any contract,
arrangements or understandings with any person with respect to any securities of
Luby's, including, but not limited to, joint ventures, loan or option
arrangements, puts or calls, guarantees against loss or guarantees of profit,
division of losses or profits, or the giving or withholding of proxies; (vii) no
-16-
associate of any participant in this solicitation owns beneficially, directly or
indirectly, any securities of Luby's; (viii) no participant in this solicitation
owns beneficially, directly or indirectly, any securities of any parent or
subsidiary of Luby's; (ix) no participant in this solicitation or any of his/its
associates was a party to any transaction, or series of similar transactions,
since the beginning of Luby's last fiscal year, or is a party to any currently
proposed transaction, or series of similar transactions, to which Luby's or any
of its subsidiaries was or is to be a party, in which the amount involved
exceeds $120,000; (x) no participant in this solicitation or any of his/its
associates has any arrangement or understanding with any person with respect to
any future employment by Luby's or its affiliates, or with respect to any future
transactions to which Luby's or any of its affiliates will or may be a party;
and (xi) no person, including the participants in this solicitation, who is a
party to an arrangement or understanding pursuant to which the Ramius Nominees
are proposed to be elected has a substantial interest, direct or indirect, by
security holdings or otherwise in any matter to be acted on at the Annual
Meeting.
OTHER MATTERS AND ADDITIONAL INFORMATION
The Ramius Group is unaware of any other matters to be considered at the
Annual Meeting. However, should other matters, which the Ramius Group is not
aware of a reasonable time before this solicitation, be brought before the
Annual Meeting, the persons named as proxies on the enclosed GOLD proxy card
will vote on such matters in their discretion.
SHAREHOLDER PROPOSALS AND DIRECTOR NOMINATIONS
Proposals of shareholders for inclusion in the Company's proxy
statement and form of proxy for the Company's 2009 Annual Meeting of
Shareholders submitted pursuant to Rule 14a-8 under the Securities Exchange
Act of 1934 must be received in writing by the Company at its corporate
office no later than ___________, 2008. Notice of a shareholder proposal
submitted outside the processes of Rule 14a-8 with respect to the Company's
2009 Annual Meeting of Shareholders will be considered untimely if received
by the Company after ____________, 2008.
The Company's Bylaws provide that candidates for election as directors at
an Annual Meeting of Shareholders will be nominated by the Board of Directors or
by any shareholder of record entitled to vote at the meeting, so long as the
shareholder gives timely notice thereof. To be timely, such notice must be
delivered in writing to the Secretary of the Company at the principal executive
offices of the Company not later than 90 days prior to the date of the meeting
of shareholders at which directors are to be elected and must include (1) the
name and address of the shareholder who intends to make the nomination; (2) the
name, age, and business address of each nominee; and (3) such other information
with respect to each nominee as would be required to be disclosed in a proxy
solicitation relating to an election of directors pursuant to Regulation 14A
under the Securities Exchange Act of 1934.
THE COMPANY'S BYLAWS PROVIDE THAT CANDIDATES FOR ELECTION AS DIRECTORS AT
AN ANNUAL MEETING OF SHAREHOLDERS WILL BE NOMINATED BY THE BOARD OF DIRECTORS OR
BY ANY SHAREHOLDER OF RECORD ENTITLED TO VOTE AT THE MEETING, SO LONG AS THE
-17-
SHAREHOLDER GIVES TIMELY NOTICE THEREOF. TO BE TIMELY, SUCH NOTICE MUST BE
DELIVERED IN WRITING TO THE SECRETARY OF THE COMPANY AT THE PRINCIPAL EXECUTIVE
OFFICES OF THE COMPANY NOT LATER THAN 90 DAYS PRIOR TO THE DATE OF THE MEETING
OF SHAREHOLDERS AT WHICH DIRECTORS ARE TO BE ELECTED AND MUST INCLUDE (1) THE
NAME AND ADDRESS OF THE SHAREHOLDER WHO INTENDS TO MAKE THE NOMINATION; (2) THE
NAME, AGE, AND BUSINESS ADDRESS OF EACH NOMINEE; AND (3) SUCH OTHER INFORMATION
WITH RESPECT TO EACH NOMINEE AS WOULD BE REQUIRED TO BE DISCLOSED IN A PROXY
SOLICITATION RELATING TO AN ELECTION OF DIRECTORS PURSUANT TO REGULATION 14A
UNDER THE SECURITIES EXCHANGE ACT OF 1934.
The information set forth above regarding the procedures for submitting
shareholder proposals for consideration at Company's 2009 Annual Meeting of
Shareholders is based on information contained in the Company's proxy statement.
The incorporation of this information in this proxy statement should not be
construed as an admission by the Ramius Group that such procedures are legal,
valid or binding.
INCORPORATION BY REFERENCE
THE RAMIUS GROUP HAS OMITTED FROM THIS PROXY STATEMENT CERTAIN DISCLOSURE
REQUIRED BY APPLICABLE LAW THAT IS EXPECTED TO BE INCLUDED IN LUBY'S PROXY
STATEMENT RELATING TO THE ANNUAL MEETING. THIS DISCLOSURE IS EXPECTED TO
INCLUDE, AMONG OTHER THINGS, CURRENT BIOGRAPHICAL INFORMATION ON LUBY'S CURRENT
DIRECTORS, INFORMATION CONCERNING EXECUTIVE COMPENSATION, AND OTHER IMPORTANT
INFORMATION. PLEASE NOTE THAT BECAUSE THE RAMIUS GROUP WAS NOT INVOLVED IN THE
PREPARATION OF LUBY'S PROXY STATEMENT, THE RAMIUS GROUP CANNOT REASONABLY
CONFIRM THE ACCURACY OR COMPLETENESS OF CERTAIN INFORMATION CONTAINED THEREIN.
SEE SCHEDULE II FOR INFORMATION REGARDING PERSONS WHO BENEFICIALLY OWN MORE THAN
5% OF THE SHARES AND THE OWNERSHIP OF THE SHARES BY THE DIRECTORS AND MANAGEMENT
OF LUBY'S.
The information concerning Luby's contained in this Proxy Statement and
the Schedules attached hereto has been taken from, or is based upon, publicly
available information.
THE RAMIUS GROUP
_______________ __, 2007
-18-
SCHEDULE I
TRANSACTIONS IN SECURITIES OF LUBY'S
DURING THE PAST TWO YEARS
EXCEPT AS OTHERWISE SPECIFIED, ALL PURCHASES AND SALES WERE MADE IN THE OPEN MARKET.
Shares of Common Stock Price Per Date of
Purchased / (Sold) Share($) Purchase / Sale
STARBOARD VALUE AND OPPORTUNITY MASTER FUND LTD.
------------------------------------------------
32,760 9.8399 04/02/07
84 9.9900 04/04/07
22,596 10.1500 04/10/07
8,133 10.4390 04/17/07
1,344 10.2838 04/18/07
5,508 10.12259 04/19/07
4,732 10.21229 04/20/07
3,948 10.0000 04/24/07
194 9.93866 04/25/07
74,844 9.9955 04/25/07
11,508 9.9998 04/26/07
86,520 10.0019 04/27/07
37,464 9.9969 04/30/07
33,600 9.9970 05/01/07
588 10.0000 05/02/07
12,177 10.1971 05/03/07
9,492 10.0988 05/04/07
22,680 10.1386 05/07/07
10,080 10.0600 05/08/07
59,640 10.0552 05/09/07
46,200 10.0429 05/10/07
7,056 10.2281 05/14/07
I-1
29,820 10.1485 05/15/07
14,952 10.1499 05/16/07
10,080 10.1458 05/17/07
42,000 9.5079 06/05/07
24,276 9.6487 06/06/07
35,700 9.5236 06/07/07
19,488 9.7220 06/08/07
46,536 10.0007 06/11/07
98,448 9.3706 06/12/07
9,072 9.4426 06/13/07
41,160 9.4707 06/14/07
28,560 9.4944 06/15/07
6,636 9.4914 06/18/07
44,772 9.4957 06/20/07
25,200 9.4830 06/21/07
52,752 9.9061 06/26/07
32,088 9.9792 06/28/07
18,312 10.0020 06/29/07
34,944 9.4036 07/18/07
126,000 9.4561 07/18/07
90,636 9.4997 07/19/07
756 9.4961 07/19/07
32,340 9.4968 07/20/07
9,828 9.4920 07/20/07
1,260 9.4740 07/23/07
57,036 9.4936 07/24/07
142,380 10.0024 08/17/07
I-2
PARCHE, LLC
-----------
204,000* 9.5000 07/18/07
6,656 9.4036 07/18/07
24,000 9.4561 07/18/07
17,264 9.4997 07/19/07
144 9.4961 07/19/07
6,160 9.4968 07/20/07
1,872 9.4920 07/20/07
240 9.4740 07/23/07
10,864 9.4936 07/24/07
27,120 10.0024 08/17/07
RCG ENTERPRISE, LTD
-------------------
NONE
RCG STARBOARD ADVISORS, LLC
---------------------------
NONE
RAMIUS CAPITAL GROUP, L.L.C.
----------------------------
NONE
C4S & CO., L.L.C.
-----------------
NONE
PETER A. COHEN
--------------
NONE
--------
* Shares were acquired in private transactions with various transferors for
which Ramius Capital Group, L.L.C. or an affiliate serves as the
investment manager, the managing member or the managing member of the
investment manager.
I-3
MORGAN B. STARK
---------------
NONE
THOMAS W. STRAUSS
-----------------
NONE
JEFFREY M. SOLOMON
------------------
NONE
STEPHEN FARRAR
--------------
NONE
WILLIAM J. FOX
--------------
NONE
BRION G. GRUBE
--------------
NONE
MATTHEW Q. PANNEK
-----------------
NONE
JEFFREY C. SMITH
----------------
NONE
GAVIN MOLINELLI
---------------
NONE
I-4
SCHEDULE II
THE FOLLOWING TABLE IS REPRINTED FROM LUBY'S PROXY STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION ON ___________, 2007
OWNERSHIP OF EQUITY SECURITIES IN THE COMPANY
The following table sets forth information concerning the beneficial
ownership of the Company's common stock, as of _________, 2007, for (a) each
director currently serving on the Company's Board, (b) each nominee for election
as a director at the 2008 Annual Meeting, (c) each of the officers named in the
Summary Compensation Table not listed as a director, and (d) all directors and
executive officers as a group. In general, "beneficial ownership" includes those
shares a director or executive officer has the power to vote or transfer and
shares that the director or executive officer has the right to acquire within 60
days after _________, 2007.
II-1
IMPORTANT
Tell your Board what you think! Your vote is important. No matter how many
Shares you own, please give the Ramius Group your proxy FOR the election of the
Ramius Group's Director Nominees by taking three steps:
o SIGNING the enclosed GOLD proxy card,
o DATING the enclosed GOLD proxy card, and
o MAILING the enclosed GOLD proxy card TODAY in the envelope provided
(no postage is required if mailed in the United States).
If any of your Shares are held in the name of a brokerage firm, bank, bank
nominee or other institution, only it can vote such Shares and only upon receipt
of your specific instructions. Accordingly, please contact the person
responsible for your account and instruct that person to execute the GOLD proxy
card representing your Shares. The Ramius Group urges you to confirm in writing
your instructions to the Ramius Group in care of Innisfree M&A Incorporated at
the address provided below so that the Ramius Group will be aware of all
instructions given and can attempt to ensure that such instructions are
followed.
If you have any questions or require any additional information concerning
this Proxy Statement, please contact Innisfree M&A Incorporated at the address
set forth below.
Innisfree M&A Incorporated
501 Madison Avenue, 20th Floor
New York, NY 10022
Shareholders Call Toll-Free at: (877) 800-5185
Banks and Brokers Call Collect at: (212) 750-5833
PRELIMINARY COPY SUBJECT TO COMPLETION
DATED ___________, 2007
LUBY'S, INC.
2008 ANNUAL MEETING OF SHAREHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE RAMIUS GROUP
THE BOARD OF DIRECTORS OF LUBY'S, INC.
IS NOT SOLICITING THIS PROXY
P R O X Y
The undersigned appoints Jeffrey C. Smith and Gavin Molinelli, and each of them,
attorneys and agents with full power of substitution to vote all shares of
common stock of Luby's, Inc. ("Luby's" or the "Company") which the undersigned
would be entitled to vote if personally present at the 2008 Annual Meeting of
Shareholders of the Company scheduled to be held at _____________ located at
_____________, _______, _______, ________, on January 15, 2008 at _______ _.m.,
___________, and including at any adjournments or postponements thereof and at
any meeting called in lieu thereof (the "Annual Meeting").
The undersigned hereby revokes any other proxy or proxies heretofore given to
vote or act with respect to the shares of common stock of the Company held by
the undersigned, and hereby ratifies and confirms all action the herein named
attorneys and proxies, their substitutes, or any of them may lawfully take by
virtue hereof. If properly executed, this Proxy will be voted as directed on the
reverse and in the discretion of the herein named attorneys and proxies or their
substitutes with respect to any other matters as may properly come before the
Annual Meeting that are unknown to the Ramius Group a reasonable time before
this solicitation.
IF NO DIRECTION IS INDICATED WITH RESPECT TO THE PROPOSAL ON THE REVERSE, THIS
PROXY WILL BE VOTED FOR PROPOSAL 1.
This Proxy will be valid until the sooner of one year from the date indicated on
the reverse side and the completion of the Annual Meeting.
IMPORTANT: PLEASE SIGN, DATE AND MAIL THIS PROXY CARD PROMPTLY!
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
[X] PLEASE MARK VOTE AS IN THIS EXAMPLE
THE RAMIUS GROUP STRONGLY RECOMMENDS THAT SHAREHOLDERS VOTE IN FAVOR OF THE
NOMINEES LISTED BELOW IN PROPOSAL NO.1
Proposal No. 1 - The Ramius Group's Proposal to Elect Stephen Farrar, William J.
Fox, Brion G. Grube and Matthew Q. Pannek to serve as directors until the 2011
Annual Meeting of Shareholders.
WITHHOLD FOR ALL
AUTHORITY TO EXCEPT
FOR ALL VOTE FOR ALL NOMINEE(S)
NOMINEES NOMINEES WRITTEN BELOW
Nominees: Stephen Farrar [ ] [ ] [ ]
William J. Fox
Brion G. Grube ______________
Matthew Q. Pannek
Proposal No. 2 - To ratify the appointment of Grant Thornton LLP as independent
auditor for the 2008 fiscal year.
|_| FOR |_| AGAINST |_| ABSTAIN
THE RAMIUS GROUP MAKES NO RECOMMENDATION ON PROPOSAL NO. 2
DATED:_________________________________________
_______________________________________________
(Signature)
_______________________________________________
(Signature, if held jointly)
_______________________________________________
(Title)
WHEN SHARES ARE HELD JOINTLY, JOINT OWNERS SHOULD EACH SIGN. EXECUTORS,
ADMINISTRATORS, TRUSTEES, ETC., SHOULD INDICATE THE CAPACITY IN WHICH SIGNING.
PLEASE SIGN EXACTLY AS NAME APPEARS ON THIS PROXY.